Esperion Therapeutics seeking $70 million in IPO filing

In documents filed Tuesday with the U.S. Securities and Exchange Commission, the company declared that it is setting a $70 million goal for the initial public offering and will be traded on the Nasdaq Stock Market under the symbol ESPR.

Esperion President and CEO Tim Mayleben (left) and Chief Science Officer Roger Newton are taking the company public for the second time.

Melanie Maxwell | AnnArbor.com file photo

Founder and chief science officer Roger Newton, a co-inventer of Lipitor, has already taken a company named Esperion Therapeutics to an IPO. He sold the first version of the company to Pfizer in 2004 for $1.3 billion.

When Pfizer closed its Ann Arbor offices in 2007, it also shut down work on the drugs that Esperion had been developing. The following year, Newton raised more than $22 million to buy back the intellectual property and re-launched the company.

Newton stepped aside as CEO of Esperion in January when Tim Mayleben, who had been the chief operating officer and chief financial officer of the original Esperion, returned to lead the company.

Esperion is currently focused on clinical tests of a drug that would lower “bad” LDL cholesterol without the use of statins, which cause a negative reaction in some patients. Mayleben previously told AnnArbor.com that the drug, ETC-1002, is on track to be submitted to the FDA for approval in approximately three years.

“We’re pursuing a path that would allow us to take this drug through [the FDA] approval process and onto the market ourselves,” he said at the time.

In 2000, the first Esperion filed an IPO looking to raise $138 million. The company was listed on Nasdaq for three years before Pfizer purchased the company for $35 per share.

The pharmaceutical giant paid a premium to acquire the company. According to a CNN article, the purchase price was 54 percent higher than Esperion’s average closing share trading price over the 20 days before the company was purchased.

In its current form, Esperion employs 13 people, many of whom worked for the first Esperion and Pfizer, at the Michigan Life Science and Innovation Center that was also formerly a Pfizer property.

The company has raised nearly $57 million since its inception five years ago, including multiple investments from local venture capital fund Arboretum Ventures.

In its IPO filings, Esperion reported that as a development stage company it had net losses of $11.7 million in 2012 and $10.8 million in 2011. Like most pharmaceutical startups, the company will continue to operate at a loss until the drug is commercialized.

Comments

Jay Thomas

Fri, May 17, 2013 : 5:18 a.m.

Hopefully someone won't buy it with the intention of relocating it. That has tended to work against Michigan in recent years.

1bit

Fri, May 17, 2013 : 10:34 a.m.

I would assume that to be the entire intention here. Use venture cap funds and money generated from the IPO to get the drug development through a couple more milestones. Strike a deal with a big pharmaceutical company that insures more payments as more milestones are met. Then, with successful phase 3 studies, sell the drug/company for a billion or so to the pharmaceutical company.
In today's world that's how these things work. This company appears to have only one drug and there is no way they would try and market / manufacture / sell it on their own.

Kai Petainen

Fri, May 17, 2013 : 4:52 a.m.

Sorry for all the questions. According to Crains
&quot;Esperion is based in the Michigan Life Science and Innovation Center.&quot;
But that got me thinking... as that is part of the MEDC.
&quot;November, 2012, Ann Arbor SPARK transferred ownership of the Michigan Life Science and Innovation Center to the Michigan Economic Development Corporation (MEDC)&quot;
So will the state and the tax-payers benefit from the IPO?
Is the state in the business of doing IPOs?

grs

Fri, May 17, 2013 : 3:30 a.m.

How's the last company doing that Mayleben ran? Why no mention of Aastrom?

whatsupwithMI

Sat, May 18, 2013 : 1:53 a.m.

Aastrom has been publicly-traded for what, 20 years now? Never a product, but a huge history of accepting overnight &quot;investments&quot; where the big VC firms reap profits from their share discount. (its verifiable).
Most folks I know had stopped watching it about a decade ago; I hadn't realized they had burnt through so many CEO since the tall guy (let alone research VPs).
fun read.

Kai Petainen

Sat, May 18, 2013 : 12:18 a.m.

grs... thanks for the info... that's useful to know.

grs

Fri, May 17, 2013 : 2:21 p.m.

To Kai:
It's interesting you looked at Mayleben's remaining stock in Aastrom. The company said stock-based compensation lead to its bad financials.
http://www.genengnews.com/gen-news-highlights/aastrom-starts-layoffs-slashes-expenses-as-phase-iii-trial-halted/81248151/
&quot;The company blamed its losses on a noncash change in the fair value of its warrants, a noncash accretion of convertible preferred stock, and rising research and development expenses. The R&amp;D spending reflected the REVIVE clinical trial, as well as higher noncash stock-based compensation expenses, and the launch of a Phase IIb study for its lead product, ixmyelocel-T for dilated cardiomyopathy (DCM).&quot;

Kai Petainen

Fri, May 17, 2013 : 4:28 a.m.

although he retired, he's not completely gone from ASTM
With 133,000 shares, he's still the #1 insider at ASTM (excluding funds and institutions)
http://tinyurl.com/bcp852x
so you raise a very good point grs... when people look at management, it's good to look at how they are doing at the other companies that they run (or retire from)

Kai Petainen

Fri, May 17, 2013 : 4:22 a.m.

hmmm... fascinating observation.
&quot;Aastrom Biosciences CEO Tim M. Mayleben Announces Plan to Retire&quot;
http://tinyurl.com/aufajzp
I'm always amazed when people say that they are retiring -- but don't. I'm not sure what to call that... when you say you're doing something, but you do something else instead? A sudden change of plans?
According to the SEC document, he was at Esperion when he retired, so he didn't retire.
&quot;Tim M. Mayleben has served as our President and Chief Executive Officer since December 2012 and as a member of our board of directors since February 2010.&quot;
That's not retiring -- he left one job for the other.
The press release should have stated:
&quot;Aastrom Biosciences CEO Tim M. Mayleben Leaves and Stays at Esperion&quot;
Since ESPR will be a public company, investors will want to know that he retired from the other company.

whatsupwithMI

Fri, May 17, 2013 : 2:05 a.m.

I have no info about SPARK (and I do consider personally some of SPARK marketing to be 100% nonsense), but Roger Newton at least has in my opinion proven himself to be a class act.
You can count on the thumbs of one hand the local biotech startups that have been acquired and also found it &quot;possible&quot; to give something meaningful back to their staff from that acquisition.

Kai Petainen

Fri, May 17, 2013 : 1:25 a.m.

&quot;Michigan Land Bank Track Authority &quot;
Who's a member of that? Michael Finney. Former CEO of SPARK.
So, one way to look at the lease... is that it went from SPARK to SPARK.
Since it was at the Michigan Land Bank... I figured I'd check out the minutes... no luck. I see no mention of it in the minutes. Michigan Land Bank minutes: http://tinyurl.com/b5nngsl
Question -- I don't know much about the Michigan Land Bank... but isn't that for foreclosures? So why would Esperion go to that?

Kai Petainen

Fri, May 17, 2013 : 1:44 a.m.

Here's another way of phrasing the question above. Since it went to the Michigan Land Bank...
&quot;The State of Michigan Land Bank Fast Track Authority was created under Public Act 258 of 2003 with the mission of returning blighted tax reverted properties to productive and economically viable use. &quot;
That implies.... that Esperion was a &quot;blighted tax reverted properties&quot;, correct?
And since the property was at SPARK... is SPARK a &quot;blighted tax reverted properties&quot;?
I don't know the answer to this question, but I don't understand why it would go to the Michigan Land Bank Track Authority? Is that common? Do other businesses do that?

Kai Petainen

Fri, May 17, 2013 : 12:30 a.m.

For those interested, here are the SEC documents
http://tinyurl.com/amf3z6l
Oh... that has a statement about SPARK
&quot;During 2012 and 2011, an officer of the Company was a non-voting member of the Board of Directors of the not-for-profit entity, Ann Arbor SPARK, that owned the facility leased by the Company (see Note 7). In November 2012, the lease was assigned to the Michigan Land Bank Track Authority and as of December 31, 2012 was no longer considered a related party transaction to the Company. &quot;

Kai Petainen

Fri, May 17, 2013 : 12:06 a.m.

Fascinating.
Esperion was located at SPARK, and Roger Newton is at SPARK.
So... any comment from SPARK?
Wish them the best... neat story. Look forward to seeing the public stock to analyze.

Lizzy Alfs

Fri, May 17, 2013 : 12:05 a.m.

Very cool that stuff like this is happening in the area. I highly recommend this article from 2009 about the second Esperion (As Newton said at the time, &quot;We're in a totally different economic climate.&quot;)
http://www.annarbor.com/business-review/roger-newton-economy-alters-strategy-for-second-esperion-therapeutics/

CLX

Fri, May 17, 2013 : 1:24 a.m.

I remember when they sold out the first time - a few people walked away with tons of money, and everyone else was left without a job.